Rachel Reeves Announces End to Income Tax and National Insurance Threshold Freeze in 2028

Oct 30, 2024, 01:21 PM

Rachel Reeves, the Chancellor and Labour Party MP, has announced that the freeze on income tax thresholds will not be extended beyond 2028-2029. From that point onwards, personal tax thresholds will be uprated in line with inflation. This decision reverses previous speculation that the freeze might be extended until 2030. The freeze on income tax thresholds has been criticized for pushing more people into higher tax bands. Reeves emphasized that extending the threshold freeze would hurt working people. This move is seen as a significant boost for workers who would have been impacted by the continued freeze. Additionally, the freeze on National Insurance thresholds will also end in 2028, and the decision not to extend the freeze would have raised £7bn by the end of the parliamentary term.